Market News Alert: China Direct Industries -- September 29, 2010
September 29 2010 - 9:15AM
Marketwired
Stock Market Alerts' performance stock list includes: China Direct
Industries, Inc. (NASDAQ: CDII), Newmont Mining Corporation (NYSE:
NEM), Ivanhoe Mines Ltd. (NYSE: IVN) and United States Steel
Corporation (NYSE: X).
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Yesterday after the markets closed, China Direct Industries,
Inc. (NASDAQ: CDII) issued a press release announcing that it
recently received several magnesium contracts valued at
approximately $6.5 million to be delivered by the end of calendar
year 2010.
Prices of pure magnesium have recently surged to over $2,900 per
metric ton FOB China, an increase of over 7% in the past two weeks.
This is mainly due to the rising price of ferrosilicon, one of the
key raw materials in the magnesium production process. Many
ferrosilicon producers are experiencing rolling blackouts as part
of the Chinese government's initiative to meet their yearend energy
savings target. This has caused a shortage of ferrosilicon supply
resulting in a price increase of more than $200 per metric ton. In
a market where magnesium supplies have been declining, the
uncertainty of ferrosilicon pricing has caused many magnesium
producers to refrain from offering long term contracts.
International Magnesium Group, our wholly owned subsidiary is,
however, able to provide long term magnesium supply contracts based
on our innovative cost indexed pricing formula, as we ramp up our
production in both Baotou Changxin Magnesium and Taiyuan Chang
Magnesium facilities in the coming months.
Commenting on the contracts, Dr. James Wang, Chairman and CEO of
China Direct Industries, Inc., stated, "We are excited to receive
these recent contracts during a time of uncertainty in the
magnesium market. We also believe balance will be restored in the
magnesium markets as other metals markets have begun to strengthen
due to improving global demand and we see prices returning to more
sustainable levels in the range of $3,000 to $3,300 per ton FOB
China in the coming months. We are also confident that IMG's cost
indexed pricing guarantee and shipment commitments will allow IMG
to gain additional market share during this time of price
strengthening amid supply disruptions and we intend to aggressively
pursue sales opportunities as we position our magnesium operations
for future growth."
The stock closed yesterday $1.20 a share.
Newmont Mining Corporation (NYSE: NEM) up 2.5% on 8.5 million
shares traded.
Newmont Mining Corporation is one of the leading mining
companies in the U.S.
Ivanhoe Mines Ltd. (NYSE: IVN) up 5.3% on 4.2 million shares
traded.
Ivanhoe Mines is an international mining company with operations
focused in the Asia Pacific region.
United States Steel Corporation (NYSE: X) up 2% on 10.5 million
shares traded.
United States Steel Corporation is one of the leading steel
companies in the U.S.
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